Liquidity structure | Let's put speed profile into context

Basic concepts, Liquidity, TPO chart, Speed profile

During the 2021 GameStop gamma squeeze, the retail crowd discovered the options market and the hedging activity of market makers. The newly discovered “low – the idea that options positioning can directly impact the price of the underlying asset – went through multiple, almost conspiratorial misinterpretations. On the back of this, a lot of furus jumped into building gamma/delta etc. data-providing services, operating on the old “sell shovels during a gold rush” principle.
Market makers started to be wrapped in a kind of mystique, as if they were the shadowy masterminds controlling the market. In furu circles, anyone who branded themselves as an “ex–market maker” could expect instant popularity, because the retail herd felt that one of these supposedly all-knowing, anointed high priests of the market had arrived to reveal the big secrets.
In other words, they thought they’d found the free lunch.
These furus try to explain everything with dealer flows and with the derivative functions of the Black–Scholes pricing model, no matter the cost. Meanwhile, a big percent of the retail crowd has lost touch with the actual reality of how markets function.

The more someone throws around terms like “skew”, “vanna”, “volga”, “gamma”, “fixed-strike vol”, “opex flows”, etc. in ever more convoluted contexts, the more convincingly they can sell themselves to retail as some omniscient professor – while in fact giving completely unrealistic and false explanations of what market-maker positioning data is actually for, and why specific price moves happen.
In doing so, they effectively neutralize a very valuable tool (such as what OptionsDepth provides) by attaching a useless and unrealistic meaning to it.

The goal of my current educational series is to steer my subscribers’ thinking back toward practical use, and to show how positioning data complements the trading and analytical methods that legendary momentum traders have used for decades. I’ll start with the core concepts and how to apply them, the way I learned them from my former english mentor, who himself was one of the protégés of a well-known ‘Market Wizard’ (and with whom I was lucky enough, to spend three hours like 10+ years ago, talking about markets and trading strategy).
Later, I’ll move on to the mathematical concepts, such as distributions and derivative functions (the Greeks), and I’ll show precisely how positioning data can be used by non-institutional traders to improve their trading. And I want to stress this: this is for non-institutional traders.

So let’s begin…